Get a helmet, we are screwed!

Wow yeah. Good morning to -- fiber -- brought -- -- network. -- capital funding corporation your future finance. Nice hot -- common -- in the mid to upper ninety's. Summer is here. Joining us now we got a bunch of guests in response to all the you know the Supreme Court everything going on in the world. Peter -- joins us now he is the CEO. Of Euro Pacific Capital. He's the author of the real crash America's. Coming bankruptcy Peter -- welcome back to WRKO. So now that obamacare has been ruled constitutional. Are you gonna have to change is titled your book. While personal bully that the fact that they're going -- could strike it down. Simply worsened the economic problems for the United States so I guess like in -- But did title of the book but you know it's it's I don't care -- they wanna call constitutional it's unconstitutional. Regardless of -- Supreme Court -- in fact. The Supreme Court admitted that congress has no power to force Americans to buy health insurance. But that it's that it can actually if you don't buy it which it would seem to be a distinction without a difference because obviously if they make attacks high enough. People would have no choice but to buy health insurance and then the act could be unconstitutional. So what the the court says the only reason it's constitutional. Because the penalty for not buying health insurance is so low. That most people ignore it and it just won't buy health insurance anyway so -- the Supreme Court said is that it's constitutional because it won't work. But I think they'll -- -- it's allow the decision because obviously. The intent of the bill. Is still force you to buy health insurance even if that doesn't do it now of course they're out. -- to raise the penalties to get -- People by the health insurance but then the minute they do that it's unconstitutional. Court the court and also the court made another big mistake if this is attacks. And it's it's really not attacks and and -- added that the justices. That dissent that were -- because -- the primary purpose of attacks have to be to raise revenue that's about why this is their. But. If these attacks it's unconstitutional. The tax because it is the direct attacks that needs to be apportioned the supreme. Court ruled that this was not a direct tax. Incomplete violation of all Supreme Court precedent of course it's a direct act. Is -- that is paid directly to the government by the people who worked -- it's like the -- actress about like as a sales tax. If you don't buy something. It you know there's no product upon which the taxes -- -- -- supply you a percentage checked -- into the government. And the courts said that while it's not a direct tax because every American doesn't pay it which is nonsense it doesn't matter how many Americans pay the tax the income tax which was a direct -- was initially declared unconstitutional. It -- they amended the Supreme Court. The -- actually applied to 2%. Of the population when they first been posted yet that was the direct tax on the Supreme Court struck it down so it's allow the decision. But of course it's also bad economics in the fact that -- the fact it's back it'll work. You -- that the whole reason the individual mandate was there. Was because at least that the Obama administration knew that if -- told insurance companies that they can't discriminate based on pre existing conditions. No healthy people would buy insurance and the whole system would collapse. And and the penalty that they have now. Like for -- -- in my circumstances. It's about a 2000 dollar penalty if I don't buy insurance since my insurance cost me a lot more than 2000 dollars a year. It's better for me to stop buying insurance and just wait till after I get sick and -- it needed. Yes it's a very curious decision one driven it seems by a desire. Of the court to not have on its hands responsibility for having interfere with what -- views I guess is being a political decision. It you know they they're concerned about being overly activist and the remedy was to be overly activist. Well you know -- the role of the Supreme Court is not to rubber stamp. You know bills is to make sure that what the congress does is constitutional. In. This clearly is the hot and it's up to the court to strike it down there not doing their job they're not supposed to be rubber stamp that is supposed to be checks and balances. And they didn't do that you know if congress passes an unconstitutional. Statute the Supreme Court is supposed to strike it that. Your book is called the real crash America's coming bankruptcy return to Peter -- how does this exacerbate. Things he obamacare law. Remaining in place. Well number one it is going to increase. The cost of care in this country it's gonna make care more expensive now more affordable. It's going to hurt the the ability of the insurance company to function. And I think businesses valued -- if if you out of more than fifteen players employees. You are subject to -- The requirement to provide insurance but if you are fewer than fifty employees you're not. Basically a lot of companies are gonna try to pare back the number of employees to get under fifty. And what you're under fifty it makes sense for all your employees to drop your insurance so if you have a business that has forty employees. And you're currently providing insurance. You're much better off. Discontinuing the insurance because your employees no longer need it. Because that's much better for your employees suggest. You know pay the fine so you can. Then eliminate your insurance and you can just give your employees are raised because they no longer longer need -- -- Bobby interstate sink to about it is. There's no way I didn't even notice that if you don't pay the fine the government can't force you to do. -- so the only thing they can do as a -- income tax refund. But if you're not getting a refund you know if you actually Obama into the IRS at the end of the year that they can't take -- can't they can't -- so. All right you're saying a lot includes no power to assess the fine. Right they can't you they can't let your bank account they can't they can garnish your wages. So basically what they're saying is. You don't buy insurance if your help please don't buy insurance the issue probably docket -- -- And if you do get sick or you can get insurance after the fact it basically like saying. Poll voters don't buy fire insurance can assure you also probably not gonna Bordal but it does burned out. Wallet stolen -- you can call up and get the insurance policy. So this this state destroys. The very means. Of -- what insurance is all about and I think maybe that's what. The plan is all walks because after the government totally destroys the healthcare industry staking claim that the free market doesn't work and they can say we need a social. -- hello yeah. And avid I assume that eventually be like the British system were all doctors are employed by the by the federal government and in it will be totally controlled is that where you would anticipate twenty years down the road. Well now because we're going to be broke longer afford I mean we can't afford that's the good news I suppose that the economy is gonna claps all of what happened. Why is the economy and a collapsed. Well because well because we are broke coming up the first that's the point. But my block I mean if you look at what's happening in Europe right now. The problem is that governments have too much debt and the markets are afraid that they can't. Pay it back all the same is true of the United States. Our government has borrowed way beyond the capacity of American taxpayers to repay the loans. Right now the Fed has got interest rates at zero answer because rates are really low the Fed can afford. Two big interest payments at least about the dead even if they can't afford to pay it back. But the problem is the biggest interest rates Marcus stay low and definitely. At some point just like they -- countries like Spain -- interest rates are going to rise sharply in this country and when that happens. We can't pay the government is gonna -- default or the Fed is about the prince so much money. That the doll's gonna collapse we're gonna help runaway inflation so those are the two possibilities. Default opt out Obama's. These are a collapse of the banking sector because of interest rates rise. Every single bank that was bailed out with -- is gonna fail again all the the losses are gonna be bigger this time. Our housing prices will tumble once again -- interest rates rise so that's whatever we think we saved ourself from in 2008. Is gonna come back twice is -- when interest rates go -- which is why the Fed is so desperate to keep them so low. But the longer the Fed keeps rates low hired there ultimately going to arise in the more people it's going to be. Leadership -- I guess the real crash America's coming bankruptcy is his book so the downside. To keeping interest rates artificially low which is what's going on right now the Fed is forcing them. Down to -- to -- record low areas. That every day we keep them there means that the repercussions are going to be worse why is right. Because we're able to keep borrowing money it's just -- interest rates go up right now. The federal government would have to stop borrowing because it could afford it it would have to cut back. Do we have to happen austerity just like your added pressure about Europe right now but by keeping rates at zero. The government can keep maintaining these huge deficits so our national that is going by -- to -- dollars a year. More and more people can refinance their mortgages to introduce lower rate mortgages. But people don't understand. There is a loss they are where the borrower refinances and gets a lower price payment. The lender is suffering because now electorate. I guess -- lower income stream on the mortgage -- that's okay now because the Fed is on the banks the ball with 0% interest rates so they can still make money. -- 4% mortgage. But it interest rates go to 5% or 6% and the banks or stop collected 4%. -- -- -- -- So what the what the what the battle to save his. The lender loses of course -- the banks fail the government could go to the -- as a taxpayer to try to balance out the banks and of course still. Because the national that is getting bigger every day because of the bad. Went interest rates go up let's say it happens two years from now when the national dentist point eight trillion dollar. And -- interest rates go to 5%. What else in the process that trillion dollars a year are participating interest that's five times we're playing now so where's the money come from. To -- all -- interest. So when -- fact that call laps of our economy already happened. And what we're doing now is following policies. That allow us to avoid having the rubble fall on us in til later when the rubble will be bigger and heavier. Absolutely. We're doing -- postponing. The -- we're not we're not solving the problems we're not -- avoid the -- We simply postponing it but the active postponing it. Exacerbates its so it's ultimately going to be somewhat forced. You know it was just swallowed the bitter tasting medicine at -- -- we knew we don't like the way case but we would. Saw all the probably cure the disease. But as a result we don't care as these because we all want a place that benefits as a disease gets worst. And we're have to swallow the medicine eventually anyway even though it could be that much more bitter. Because that we don't look completely ruin the economy because you'll destroy the value of money wiped out everybody's savings have hyperinflation. And that is going to be much much worse than -- depression. Peter Schiff CEO of Euro Pacific Capital his book is the real crash America's coming bankruptcy thank you for coming on once again. All right coming up in just couple minutes we will have the head of the Republican National Committee writes preakness will be here on the Todd -- shows 680 WRKO. Broadcasting live on both fifth 2001. Stick proved true. This is Boston's talk station BM's security WR Kerio.